China-India Cooperation Under the SCO Framework

Closer China-India cooperation under the SCO mechanism in fields like regional security and stability, infrastructure connectivity, energy,finance and education will benefit not only both the countries but other SCO member states as well. Analysts predict that China and India can put aside their bilateral disputes and join hands to participate in, and promote the development of, the SCO.

by
Long Xingchun & Sheng Yangyang

May 14, 2018

June 9, 2017: Chinese President Xi Jinping and leaders of other member states of the Shanghai Cooperation Organization (SCO), as well as Indian and Pakistani prime ministers, pose for a photo at the 17th meeting of the Council of Heads of State of the SCO held in Astana, capital of Kazakhstan. At the meeting, India and Pakistan were officially admitted into the SCO as member states. [Xinhua]

China-India Cooperation Under the SCO Framework

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The moment the Shanghai Cooperation Organization (SCO) was founded, India showed great interest. In 2005, it applied to become an SCO observer state. During the 2009 SCO summit in Yekaterinburg, Russia, Indian representatives attended the meeting of the SCO Heads of State Council, an essential step towards India’s entry into the organization. In 2015, the SCO summit in Ufa passed a resolution to commence procedures to admit India and Pakistan into the SCO, putting their official entry within a stone’s throw. In June 2017, India and Pakistan were officially ratified to be member states at the SCO summit in Astana, Kazakhstan. India’s inclusion in the organization has provided another multilateral platform for China-India cooperation.

The SCO is the largest regional cooperation mechanism on the Eurasian continent. China, India and Russia are the three biggest and most populous countries in Eurasia, as well as the three largest member states of the SCO, so they shoulder important responsibility in maintaining regional peace and stability. In fact, China- Russia and India-Russia relations are better than the bilateral ties between China and India. The fact that China and India can effectively utilize the SCO cooperation mechanism to actively promote comprehensive collaboration will not only facilitate the development of the SCO and consolidate regional peace and stability, but also enhance China-India bilateral ties.

IMPROVING REGIONALSECURITY AND STABILITY

More than 16 years have passed since the United States launched its war on terrorism in Afghanistan. After investing trillions of U.S. dollars and causing tens of thousands of fatalities, peace and stability still remain elusive in the region. Obviously, Afghanistan’s stability cannot be achieved via the military campaigns of the United States and NATO – participation from neighboring countries such as China and India is also essential. Since terrorism, separatism and extremism are common threats facing all of its member states, the SCO has been keeping a close eye on the Afghanistan issue. As early as 2012, the SCO summit in Beijing unveiled the Declaration of the Heads of Stateof the Member States of theShanghai CooperationOrganization on Building aRegion of Lasting Peace andCommon Prosperity, voicing support for the United Nations’ leading role in coordinating international efforts towards peace in Afghanistan. Both Afghanistan and Iran are SCO observer states. Since India and Pakistan joined the SCO, the organization began playing a more important role in curbing instability in Afghanistan.

Afghanistan is the geographic point where East Asia, South Asia and Central Asia converge, and China and India are the two largest countries in Asia. If Afghanistan becomes a shelter for terrorist organizations, China and India would be threatened alike. Presently, the Afghan government, Pakistan, India and the United States have many disagreements on the Afghanistan issue that have resulted in the complicated situation and intermingled interests in the Central Asian country. To move forward, all involved parties must achieve common security rather than seeking their own security at other countries’ expense. Bias for a single side on such international issues will only hurt confidence in every party.

Alongside huge investments, China has provided tremendous aid and personnel training for Afghanistan. India has also provided huge economic aid for Afghanistan and helped it train administrative and military personnel. China and India share the goal of maintaining the stability of Afghanistan. China could be in an ideal position to play a constructive role in promoting trust between Afghanistan, Pakistan and India.

STRENGTHENINGINFRASTRUCTURECONNECTIVITY AND ENERGYCOOPERATION

The initial purpose of the SCO was to crack down on the “three evil forces” (terrorism, separatism and religious extremism). Nowadays, its cooperation scope has expanded to more areas, most notably infrastructure connectivity and energy. Noted as a “significant source of energy”in the 21st century, Russia and Central Asia rank near the top in terms of the reserves and output of oil, gas and coal globally. China and India are the world’ two largest emerging economies, and their demand for energy has been increasing sharply in recent years, with about 60 percent of the oil they consume coming from imports. If the two countries carry out energy cooperation under the SCO framework, not only will their energy security be enhanced, but it would also provide a huge, stable market for energy-exporting SCO member states.

To access the rich oil and gas resources of Central Asia, India planned to construct the Turkmenistan-Afghanistan- Pakistan-India (TAPI) natural gas pipeline. Soon after he took office, Indian Prime Minister Narendra Modi introduced the “ook North Policy”to promote cooperation between India and Central Asian countries. The planned 1,700-kilometer TAPI pipeline will run through mountainous regions of Afghanistan and Pakistan, which not only presents challenging security but also complicated geographical conditions, greatly increasing the requirements for technology and funds for the project. Several Chinese enterprises are known for their remarkable capacity to construct oil and gas pipelines and have rich experience to share in terms of building pipelines in alpine and frigid regions. Moreover, India can obtain financing support from the Asian Infrastructure Investment Bank (AIIB) and the SCO Development Bank to complete construction as quickly as possible, so that it can provide natural gas for Afghanistan, Pakistan and India.

While constructing the pipeline, China and India can jointly enhance infrastructure connectivity along the route, especially highways and railways, to create ideal conditions for economic development and social stability in involved countries and facilitate the construction and maintenance of the pipeline. China completed construction of a natural gas pipeline across Central Asia. Considering this background, India should collaborate with China to utilize parts of the completed pipeline or construct a parallel pipeline. By doing so, it can considerably cut the costs and construction time of the TAPI project.

Considering the security challenges in Afghanistan and India’ worry about the possibility of Pakistan blocking the pipeline, China and India can promote construction of a regional security and trust mechanism under the SCO framework that would guarantee a relationship featuring interconnected interests of countries along the route and ensure unimpeded operation. Under the SCO framework, China and India can also represent “uyers”to negotiate with “ellers,”in a bid to guarantee a stable supply-demand relationship and achieve mutually beneficial pricing. This would guarantee both the buyers’energy security and the sellers’ economic benefits.

ENHANCING FINANCIAL ANDEDUCATION COOPERATION

Considering the increasing exchange between SCO member states in recent years, the focus of cooperation has shifted to economics. To boost regional trade and accelerate construction of a joint financing mechanism among SCO member states, China proposed deepening financial cooperation within the SCO framework in 2010, seeking to establish the SCO Development Bank and exploring a new model featuring joint investment and shared benefits. Meanwhile, it expanded local currency settlement cooperation to promote regional trade. The establishment of the SCO Development Bank would be conducive to the realization of investment and financing integration in the region and bolstering regional economic cooperation of SCO member states. India takes pride in its robust supply of outstanding international financial talent. China and India have already set good examples by jointly promoting the establishment of the AIIB and the New Development Bank, and their successful experience in financial cooperation could apply to the SCO Development Bank.

At the SCO summit in Bishkek on August 16, 2007, all member states unanimously approved Russian President Vladimir Putin’s proposal to establish an SCO University. Today, the university works with 82 universities in five countries. Twenty Chinese universities including Peking University and Tsinghua University have joined the cooperative mechanism of the SCO University, under which all member colleges and universities participate in international student exchange programs and joint talent training programs. Moreover, the SCO University serves as a nongovernmental “ambassador” and a bridge for cultural exchange between SCO member states.

Currently, China and India are the two biggest sources of international students globally. Traditionally, most Indian students chose developed countries such as Britain and the United States as their destinations to study abroad. Nowadays, increasing numbers of Indian students opt to study in China. India maintains its own advantages in higher learning and has built a global reputation in IT education. India can incorporate its prestigious colleges and universities into the SCO University to promote international student exchange with China and other SCO member states. It can also share its experience in jointly building and operating the South Asian University with other South Asian Association Regional Cooperation (SAARC) member states with the SCO University.

PREVENTING DISPUTES FROMHINDERING COOPERATION

The SAARC failed to make substantial progress in resolving disputes between India and Pakistan, leaving their disagreements to plague the development of South Asia. When discussing whether to admit India and Pakistan into the SCO, concerns about whether their bilateral disputes would hinder the SCO came up again and again. After years of efforts, the SCO accepted the two countries as member states, but worries about the negative impacts of their admission have persisted.

India and Pakistan took the steps to join the SCO because they expected to benefit from the organization rather than to put their disputes on full display for the international community. Compare China and India: Despite disagreements in some areas, bilateral trade has maintained a rapid growth and the two countries have seen frequent high-level interactions over the past decade. Moreover, China and India cooperate closely in international affairs. Especially in the field of global climate change, the two countries adhere to the principle of “common but differentiated responsibilities” and frequently bargain as a team with Western developed countries.

From a practical perspective, if China and India can carry out cooperation in areas like regional security and stability, infrastructure connectivity, energy, finance, and education under the SCO framework, not only will those two countries benefit, but so will other SCO member states. The two countries can put aside their disagreements and jointly contribute to promoting development of the SCO.

Long Xingchun is director of the Centerfor Indian Studies at China WestNormal University. Sheng Yangyang isa postgraduate student in internationalpolitics at China West Normal University.